Consumption Patterns of the Millenial Generational Cohort

Abstract

This study constructs a consumption profile for the Generation Y age cohort using responses to the Consumer Expenditure Survey furnished by the Bureau of Labor Statistics from the financial crisis period. This generation was theorized to employ both economic reasons, i.e. preferences for inex-pensive products, and the desire to comply with the values and normative beliefs of social referent groups. For the rent or buy a home decision, the variability of income, risk of foreclosure and loss of mobility governed the consumption choice. For the purchase a new car or a used car decision, economic considerations dominated with variability of income being the sole explanatory variable for the choice. Family size and the need to conform to group norms explained the choice of bring-ing food from home to the workplace. Socialization opportunities and group identification ex-plained the decision to eat lunch away from the workplace. Family size and desire for group con-formity explained vacation expenditure as they did for bringing food from home. For both furni-ture and large appliances and small appliances, the need to conform to group norms was signifi-cant suggesting that they may be the subject of social interactions. Given that investment in a pri-vate education is often considered a luxury, the proportion of the family budget allocated to this expense was significant along with the expected need for conformity with group values.